Jagatjit Industries , a prominent player in the beverages and food products sector, has announced significant corporate decisions and financial results for the first quarter.

Board Approves Rs 350 Crore QIP

The Board of Directors of Jagatjit Industries, in a meeting held on August 14, approved raising funds up to Rs 350 crore through a Qualified Institutional Placement (QIP) of equity shares. This strategic move aims to bolster the company's financial position and support its growth initiatives. The QIP will involve issuing equity shares with a face value of Rs 10 each, subject to shareholder and regulatory approvals.

Q1 Financial Performance

For the quarter ended June 30, Jagatjit Industries reported:

The company experienced a significant decline in revenue and a widening of losses compared to the same quarter last year. The revenue from operations decreased by 18.80%, while the net loss more than doubled.

Segment-wise Performance

Jagatjit Industries operates in three main segments:

1. Beverages: This segment, which includes grain-based alcohol, Indian Made Foreign Liquor, country liquor, industrial alcohol, and sanitizer, reported a loss of Rs 82 lakhs.
2. Food: The food products segment incurred a loss of Rs 140 lakhs.
3. Others: The segment dealing with petroleum products trading reported a profit of Rs 1 lakh.

Other Financial Highlights

• The company's other income included a write-back of earlier year security deposits and interest payable amounting to Rs 387 lakhs.
• Finance costs for the quarter stood at Rs 675 lakhs, slightly higher than the Rs 664 lakhs reported in the same quarter last year.
• Employee benefits expense decreased to Rs 1,392 lakhs from Rs 1,835 lakhs year-on-year.

Corporate Actions

In addition to the QIP approval, Jagatjit Industries has:

1. Constituted a QIP Committee to oversee the fundraising process.
2. Scheduled its 80th Annual General Meeting for September 26.

Outlook

While the company faces challenges with declining revenues and increasing losses, the approved QIP could provide Jagatjit Industries with the necessary capital to implement strategic initiatives and potentially improve its financial performance in the coming quarters.

Investors and stakeholders will be closely watching how the company utilizes the funds raised through the QIP and its impact on future financial results.

Jagatjit Industries , a veteran in the Indian liquor industry, has marked a significant milestone with the commencement of commercial production at its new grain-based ethanol plant in Hamira, Kapurthala district, Punjab. This strategic move is set to diversify the company's portfolio and boost its financial performance.

Plant Specifications and Projected Impact

The newly operational facility boasts an impressive capacity of 200 kilolitres per day (KLPD). At full capacity, the plant is expected to:

• Generate annual revenue of Rs 550.00 crore
• Widen the company's EBITDA margin by 8-10 percentage points
• Add approximately Rs 300.00 crore to EBITDA in its first partial year of operation
• Supply 65-70 million litres of ethanol annually to Oil Marketing Companies

Strategic Implications

Roshini Sanah Jaiswal, Promoter & Executive Director of Jagatjit Industries, highlighted the strategic importance of this new venture. She stated that the plant will bring in stable, high-quality revenue, which is expected to:

• Strengthen the company's balance sheet
• Fund growth across premium spirits
• Support expansion into new markets

Company Background

Jagatjit Industries, founded in 1944, has a long-standing presence in the Indian alcohol industry. The company's core business includes:

• Manufacturing Indian Made Foreign Liquor (IMFL)
• Production of Country Liquor
• Operations through plants in Punjab and manufacturing units in Behror, Rajasthan

The addition of the ethanol plant represents a significant diversification of the company's product portfolio, potentially opening up new revenue streams in the biofuel sector.

Ethanol Industry Context

The launch of this ethanol plant aligns with India's push towards increasing ethanol blending in petrol, which aims to reduce the country's dependence on imported fossil fuels and decrease carbon emissions. This move positions Jagatjit Industries to capitalize on the growing demand for ethanol in the country's fuel mix.

The commencement of this high-capacity ethanol plant marks a new chapter for Jagatjit Industries, potentially transforming its financial outlook and market position in the coming years.